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Coupling between financing and innovation in a startup: embedded in networks with investors and researchers

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  • Daojuan Wang

    (Aalborg University)

  • Thomas Schøtt

    (University of Southern Denmark)

Abstract

Innovation may be a basis for starting a business, and financing is typically needed for starting. Innovation and financing may conceivably be negatively related, or be unrelated, or plausibly be beneficially related. These possible scenarios frame the questions: What is the coupling between innovation and financing at inception, and what is the embeddedness of coupling in networks around the entrepreneur, specifically networks with investors and researchers? These questions are addressed with a globally representative sample of entrepreneurs interviewed at inception of their business. Innovation and financing are found to be decoupled, typically; less frequently to be loosely coupled, and rarely to be tightly coupled. Coupling is promoted by networking with both investors and researchers, with additive effects and with a synergy effect. By ascertaining coupling and its embeddedness in networks as a way for building capability in a startup, the study contributes to empirically supported theorizing about capability building.

Suggested Citation

  • Daojuan Wang & Thomas Schøtt, 2022. "Coupling between financing and innovation in a startup: embedded in networks with investors and researchers," International Entrepreneurship and Management Journal, Springer, vol. 18(1), pages 327-347, March.
    • Handle: RePEc:spr:intemj:v:18:y:2022:i:1:d:10.1007_s11365-020-00681-y
    DOI: 10.1007/s11365-020-00681-y
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    2. Martina Pilloni & József Kádár & Tareq Abu Hamed, 2022. "The Impact of COVID-19 on Energy Start-Up Companies: The Use of Global Financial Crisis (GFC) as a Lesson for Future Recovery," Energies, MDPI, vol. 15(10), pages 1-15, May.
    3. Mueller, Christoph E., 2023. "Explaining the stage of product in pre-seed academic startup ventures: An empirical analysis using monitoring data from a German startup support program," Journal of Business Venturing Insights, Elsevier, vol. 19(C).

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